advice for equities startup

[def]

Laplacian, as pointed out one of our specialists with fund on-boarding will be contacting you via PM. In the meantime, if you haven't taken a look at what we bring to the table for hedge funds take a look at this link
https://www.interactivebrokers.co.uk/hmf/en/main.php

This table is a year old and the new one should be coming soon but we gaining some serious traction in the hedge fund space.
https://docs.preqin.com/reports/Hedge-Fund-Prime-Brokers-June-2018.pdf

As for programming, I personally would invest the time to code into the API or simply submit a basket MOC (which you can generate any number of automated ways) but also experiment a bit and see if any of the other 100 algos/orders types on offer via IB and third parties (CSFB, Fox River, Jefferies, QB, ...) can do a better job with what you need.

https://www.interactivebrokers.co.uk/en/index.php?f=4985

Hope this helps.

 

[easymon1]

https://en.wikipedia.org/wiki/Phased_array

 

[laplacian]

I have been writing code for quite awhile and here is how I would tackle this problem. Given that you already have a solution that will tell you what and how much to buy, you simply need a solution that can take a list of symbols and quantities and execute the orders with your broker. This could either be done using a broker API (more coding) or use commercial software that connects to your broker and can run algos (less coding). The algo in this case would be rather "dumb" in that it would simply read (via the file system) in the symbols and quantities for order execution. If I was in your situation, I would select a couple of brokers that look to meet your requirements and hire a programmer to build a very simple prototype for each broker that can connect to the broker's paper trading feature. The idea is to figure out what is going to work for you as cheaply as possible.

Thank you. What about daily processes such as daily checks and reconciliation and corporate actions - I can imagine there are a number of manual tasks to do when managing a portfolio of 500 equities, do you agree? So I would expect one software engineer for the broker API management and possibly maintaining a database, and another to help and perform the daily manual processes. Essentially, all cost on wages and zero on software (with multi-broker software only useful when managing more capital).

 

[fan27]

Thank you. What about daily processes such as daily checks and reconciliation and corporate actions - I can imagine there are a number of manual tasks to do when managing a portfolio of 500 equities, do you agree? So I would expect one software engineer for the broker API management and possibly maintaining a database, and another to help and perform the daily manual processes. Essentially, all cost on wages and zero on software (with multi-broker software only useful when managing more capital).

Having a full time software engineer on the payroll may not be necessary in the beginning. Really, you need a software solution which can execute and manage your trades and someone who can operate the software and handle the other items you mentioned ("daily checks and reconciliation and corporate actions, etc."). The creation of the software solution which doesn't sound that complex could be contracted out. You can always hire a full time software engineer if you get some traction with your fund. If I was in your shoes I would want to keep fixed costs as low as possible and a competent full time software engineer is not going to be cheap.

 

[cruisecontrol]

If you are just using MOCs, order management is pretty simple. I imagine you are a smart guy so you could probably just do it yourself instead of hiring somebody. Since your strategy is 100% systematic, you must already know how to code in order to have created that. So from that starting point, it is not much of a leap to just making the order management 100% systematic too.

That said if you are looking to have someone build it for you, my firm might be able to help. We have two professional engineers experienced with the IB API. We can build pretty much anything you might want. We can also do other stuff like evaluate your backtest for realism. Happy to talk, just PM me.